Ideas and Insight supporting all stages of Drug Discovery & Development

India: Emerging Hub of Pharmaceutical R&D

For many of the last five decades, India has been known as the largest exporter of generic drugs, particularly to the United States. However, today, in 2016, India is getting to be known for a bit more than that: as an emerging hub of pharmaceutical research and development. Companies such as Dr. Reddy’s Labs, Wockhardt, Advinus, Lupin, Zydus Cadilla, Cipla, and many others started investing in pre-clinical development of small molecules with novel targets and with novel mechanism of action.

It remains to be seen how this R&D / innovation sector shows further growth and encouragement from the government sector. I do expect some of the molecules to be developed in India up to a proof-of-concept (POC) stage and then be brought over to the West for a full development beyond Phase IIB / Phase III to commercialization. DCGI (Drug Controller General of India), the regulatory body, has openly suggested encouragement for the local Indian pharma companies to get deeper into innovation.

Perhaps the most monumental event in the history of India pharma R&D occurred in 2005, when the country signed a new patent law as part of joining the World Trade Organization (1). As a result of this treaty, patents within the country officially became recognized, and greater incentives to innovate followed. This spurred a series of events, including greater tax benefits and grants for pharmaceutical researchers in India (2). While this event opened up the door for pharmaceutical innovation in India, the breadth of its potential has not yet fully been reached. From 2005 to 2007, although pharmaceutical patents by resident Indians doubled, that rate has since declined (3).

I had a personal opportunity in 2007 to accompany Dr. John LaMattina, Global R & D President, Pfizer Inc., to India, where we had many high-level meetings with potential partner companies and also had a heartwarming meeting with the President of India, Mrs. Pratibha Patil. Again, in 2009, I accompanied the then President of R&D at Pfizer, Dr. Martin Mackay, when he gave a keynote address at the BioAsia Conference in Hyderabad and conducted some successful partnership meetings.

Clearly, there still are measures which can be undertaken to bring India to the next level in the global pharmaceutical market. India continues to lack the amount of domestic private investments as well as the “academia-collaborations” that are omnipresent in the pharma world in Europe and the U.S. (5). Both of these conditions are necessary for pharma R&D to get any more significant momentum. In addition, the biggest impediment lies in regulatory price controls, which remain a factor that stifles innovation. Although these were put in place to try to improve access to drugs, it has shown to be less effective than expected, and instead has contributed to a decrease in R&D investment across the country (6).

Finally, a slow adoption of “respect” for the patents has prevented India’s R&D sector from making the full transition from a “generics market” to a “patents market” (7). More regulatory changes need to be made to help enable Indian pharmaceutical companies with more financial and social capital for their drug research. There is lots of innovative work which is beginning to happen in the areas of tropical diseases such as malaria and some other infections disease areas, especially vaccines research. Also, the Melinda & Bill Gates Foundation is helping in this space tremendously.

According to PricewaterhouseCoopers, India’s growing economy coupled with its changing “epidemiological profile” with cardiovascular problems and other chronic diseases, make it a strong candidate to become a future powerhouse of R&D and manufacturing in pharma (8). India’s GDP is expected to grow by 5% each year for the next four decades. In addition, better health infrastructure for the nation is contributing to an aging population with a greater demand for different types of pharmaceutical drugs.

Today, the Indian government is beginning to demonstrate more interest in making India a hub of pharmaceutical innovation, at least in Southeast Asia. In fact, the national government is currently preparing for a “multi-billion dollar investment with 50% public spending to enhance [pharmaceutical] innovation capabilities” (9). This is to add on to the fact that, by law, pharmaceutical companies in India are entitled to 100% foreign direct investment (FDI) from investors. Both of these conditions, along with the fact that the country has plenty of skilled scientists, are a couple of positive signs for the future of pharmaceutical research and development in India.

Moving forward, I expect the Indian government will continue to try to grow its efforts in increasing India’s domestic R&D market. I expect that additional large-scale actions will be taken to provide Indian innovators with the necessary means to compete with the best pharmaceutical innovators in the world.

If you would like to keep track of centers of research in India, or any other country visit Scopus.